Washington watchdogs help peanut industry dodge bullet

PANAMA CITY, Fla. – Folks who earn their keep as watchdogs over U.S. Congress activities that affect the peanut industry have enjoyed a relatively quite year. But vigilance remains necessary, says Mike McLeod, who serves as counsel to the American Peanut Producers Manufacturers, Inc.

Addressing the opening session of the 6th Annual Southern Peanut Growers Conference in Panama City, McLeod said the industry “dodged a bullet,” when a congressman proposed an amendment that would have stopped the government from paying peanut storage and handling fees.

“Rep. Mark Kennedy, R-Minn., wanted to bring this proposal to the House floor,” McLeod said. “We heard about it and made some calls, and the amendment never got to the floor.”

Reasoning behind the proposal, McLeod said, was that payments to shellers and manufacturers did not benefit producers. “But if those fees are not paid by the government, shellers and manufacturers would pass the costs back to growers,” he said.

“This attempt was a revelation to the industry,” he said. “In the old days we would have blamed the shellers or manufacturers for such an out of the blue amendment. We have concluded that this one probably originated in the USDA.”

He said the attempt provided “an important lesson. We worked hard for the 2002 farm bill and in doing so put a lot of our old prejudices and enmities aside. It took a lot of cooperation and trust to work together industry-wide. It was the right time, and we came out with a program that’s good for growers, shellers and manufacturers.

“Now, we can’t afford to let bad habits get in our way. We need the mechanism we’ve created for working together to preserve (payments for) handling charges and not hamper manufacturers’ and shellers’ abilities to make a profit. In the long run, that hurts farmers.

“By the same token, payment limitations that hurt farmers also hurt shellers and manufacturers.”

He said a united industry should continue to cooperate to improve some aspects of current legislation. For instance, peanut growers need better insurance. Currently, coverage level is set at $350 per ton.

“We need a market election coverage to allow growers to recoup the price they could get from the marketplace,” McLeod noted. “We need to develop an industry position on this.”

McLeod said the year, “has been quiet regarding the peanut program. It is working well. We’ve eliminated some of the kinks from the first year, and we have not witnessed the horror stories folks expected. Some predicted too many peanuts in Texas and Georgia would result in lower prices. That has not been the case. Peanut demand is up and market prices have held steady.”

McLeod said Washington watchdogs continue to monitor congressional activity. “An appropriations bill always presents an opportunity for someone with an issue to have it addressed. Kennedy’s attempt shows that.”